P&C insurers’ aspirations of implementing advanced analytics into key areas of their business remain elusive

But pockets of progress still exist, according to Willis Towers Watson’s P&C Advanced Analytics Survey

ARLINGTON, Va., Jan. 28, 2020 (GLOBE NEWSWIRE) -- U.S. and Canadian property & casualty (P&C) insurers revealed they were either overly ambitious in their goals for implementing advanced analytics or had their long-term vision blurred by the realities of day-to-day business and market challenges. Their slower progression in using advanced analytics cuts across the key areas of their business — chiefly customer centricity, claim management and telematics — according to leading global advisory, broking and solutions company Willis Towers Watson’s (NASDAQ: WLTW) new P&C Insurance Advanced Analytics Survey Report, and prior report on this topic from two years ago.

“Certainly, there is no lack of ambition when it comes to P&C insurers wanting to use data and advanced analytics for the betterment of their business,” said Lisa Sukow, director, North America P&C practice, Insurance Consulting and Technology, Willis Towers Watson. “But by their own admission, most are falling short of those aspirations right now. One way to recondition their resolve is to align strategy and analytics by identifying what’s core to achieving a competitive edge and steer efforts and resources accordingly. They should avoid getting carried away with analytics for analytics’ sake.”

Nearly half (45%) said the prime culprit inhibiting them from making more progress in using advanced analytics centers on problems with information bottlenecks where people and systems typically need to interact. They also cited handling infrastructure constraints (37%) and a lack of sufficient staff to analyze data (37%) — underscored by its notable 13 percentage point rise compared to two years ago — as other top obstacles preventing them from becoming more data-driven.

According to the survey, participants surely expected they would be further along than they are in using advanced analytics for enhancing ever-important customer centricity. For example, more than three-quarters (77%) expected to be using internal customer data as a source by now, but only 54% are. Similar gaps in expected versus actual use exist for social media (46% versus 26%) and clickstream (34% versus 14%).

“Many insurers collect customer data as part of an application or claim process, which can be of wider value when suitable analytics are run,” said Nathalie Begin, director, North America P&C practice, Insurance Consulting and Technology, Willis Towers Watson. “However, insurers are not maximizing their internal customer data utilization — they shouldn’t overlook what is readily available. They should also take it a step further and supplement internal data selectively with external data sets to improve results.”